Whether for the holidays, a birthday, or another special occasion, stocks are increasingly being seen by investors of all ages as great and thoughtful gifts. In this segment of Backstage Pass, recorded on Dec. 17, Fool contributors Rachel Warren, Jason Hall, and Toby Bordelon discuss the trend of gifting stocks.
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Rachel Warren: For me, I also picked two of my favorite companies. I think if you're a first-time investor -- and I'm a newer investor, as you know -- I think it's a really wise idea to start out with really established companies that have a really strong history of growth, a lot of catalysts for future growth, and can profit from long-term tailwinds and have a history of being really resilient in a wide range of market conditions.
I think that's especially true right now. So for an adult, Amazon (AMZN 1.21%) was one of the first stocks that came to mind. I love how diversified the business is. This is an industry disruptor. The company started out as this e-commerce business, and now it's one of the largest cloud platforms as part of its business, Amazon Web Services, in the world.
It has this massive entertainment arm of its business. It's expanded to healthcare, grocery. I love the stock, I love how it's performed over the years. It's one I intend to hold on to for a long time, and I think it's one that it's not really too late to buy in. I think it has a lot of growth ahead. So for an adult, that's one I would gift.
For a kid, I was thinking Apple (AAPL 0.48%). Nowadays, you see even really young kids walking around with phones and iPads. I think that this is a company that has products that excite people of all ages, especially kids. I think it's a really great company to be a part-owner of, to share in its success. It pays a little itty-bitty dividend. And it's another one of those companies that continues to really perform incredibly strongly, even though we're seeing all this volatility in the market right now, and it is just done really well.
It's been one of the few tech stocks that hasn't just been obliterated in [laughs] the last few weeks as other tech stocks have. I think it's a great one to consider.
Then even though I'm not currently a crypto investor, I was thinking something that both an adult and kid would like, probably maybe a little bit of Bitcoin (BTC 0.01%) thrown in there, too. I don't know, just an interesting little basket there.
Jason Hall: I love it. You could throw me some Bitcoin, Rachel. I'd be fine with that.
Rachel Warren: Throw you some Bitcoin.
Jason Hall: I'd be happy.
Rachel Warren: That'll be my Christmas gift. [laughs]
Toby Bordelon: Kay in the Slido chat says she's giving her adult children crypto once she figured out how to do that, so that's good. That's nice thinking on that.
Jason Hall: I love what Mike's doing, too. ProShopGuy, "Instead of giving the kids Robux or the currency in Roblox, giving them Roblox's stock." Love it.
Rachel Warren: Awesome.
Toby Bordelon: Yeah good stuff. For me, for an adult. First, I think some of what may be going on here, to the extent, people do actually want this, maybe asking for Bitcoin in 2021 is like asking for cash or a gift card a couple of years ago for people who were really into that.
"Yeah, give me some Bitcoin. I'll get whatever I want." [laughs] That could be what's going on part of it, but you talk about it what you give someone.
For an adult, I'd go with Berkshire (BRK.A 2.24%) (BRK.B 1.97%) for new adult investor. The reason I do that is because that company alone by itself provides opportunity to study and learn about investing in business. For what Berkshire has invested in, you can read Warren Buffett's annual letters. So with the investment you have, you get more into investing. I think that's a good starter company.
For a kid, I might go Microsoft (MSFT 0.85%) for a couple of reasons. If they're in school, there's decent odds they actually use Microsoft products in school if you're familiar that. You can also get them excited on the gaming front with Xbox, with Minecraft, and all that stuff, but it's a lot more than that. You can take them to the Microsoft website.
They have all these great videos about stuff they're doing in artificial intelligence, virtual reality, cutting-edge technology. They can look at that and you can talk about, "Hey, your investment is doing these cool things that are really awesome."
Talk about the idea of how companies need to continue to innovate, that continue to spend on R&D. You need to reinvest in their business.
Microsoft is just so cool with that because, again, they have all these really great promotional videos that you can use to watch and talk about what they're doing. I think kids can get into that with developing technology and stuff.